statnews.com: A scrappy upstart in the pain pill business takes on mighty Purdue Pharma

11/22/2017

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ANTON, Mass. — Collegium Pharmaceutical, the scrappy upstart taking on the mighty opioid maker Purdue Pharma, is having a moment.

The company recently convinced Cigna, Humana, Navitus, and top health insurers in Florida and Pennsylvania to cover only its product Xtampza — and not Purdue’s infamous OxyContin — for most patients prescribed the long-acting opioid known to scientists as oxycodone. Earlier this month came another win: The Food and Drug Administration agreed to let Collegium update Xtampza’s label to describe data demonstrating that the capsules are harder than OxyContin to abuse when crushed.

To be sure, Collegium still has a long way to go: It has just 4 percent of the market share for long-acting oxycodone prescriptions, compared to Purdue’s 78 percent for OxyContin. Across the broader market for all types of brand-name, long-acting opioids, Collegium has just under 3 percent of prescriptions, far shy of Purdue’s roughly 60 percent.

But Collegium is gaining traction with a strategy carefully calibrated for an era of widespread public concern about the national opioid epidemic.

Purdue famously used aggressive marketing tactics to promote OxyContin in the late 1990s and early 2000s, ultimately agreeing in 2007 to pay $600 million to resolve criminal and civil charges of misleading doctors, regulators, and patients about the drug’s risks. A more recent slew of lawsuits allege that those tactics continued beyond that period.

Collegium, by contrast, is pitching Xtampza as the best opioid for a chastened era, playing up the properties that make it harder to abuse and emphasizing the need for responsible prescribing. It’s not running any ads directed to consumers.

“We don’t care if the market shrinks. We’re not trying to get more people on opioids,” Collegium CEO and founder Michael Heffernan said in an interview at his company’s headquarters here in this Boston suburb.

Heffernan’s goal is more modest: to get more patients with chronic pain to switch to or start on his pill, rather than try rival products that he sees as more likely to be abused.

Xtampza, which hit the market in June 2016, can be swallowed just like any other pill. But patients who have difficulty swallowing can also pull apart the two halves of the capsule and sprinkle the tiny balls of medication inside — like grains of sand that feel waxy to the touch — on soft food like applesauce or yogurt.

It’s that same unusual design that makes the product tougher to abuse. Using a method developed by Collegium and Massachusetts Institute of Technology scientists, the company produces a novel salt that’s not soluble and protects it with fatty waxen materials. (Most other abuse-deterrent opioids, like the version of OxyContin introduced in 2010, employ a different strategy: They focus on making the pill harder to crush.)

Still, Xtampza is far from abuse-proof. It’s still addictive. Patients can still take too many pills in too short a time. And even though it’s more difficult to do so, they can still find ways to inject or snort it.

The product also doesn’t come cheap: Xtampza costs $1,077 for 100 capsules of the common dosage of 36 milligrams, before discounts. That’s roughly in line with the other four established long-acting abuse-deterrent opioids on the market; OxyContin, for instance, costs $1,072 for 100 tablets of a 40-milligram dosage before discounts, according to data from Truven Health Analytics, part of the IBM Watson Health business.

By contrast, traditional opioids that are not designed to deter abuse usually cost less, in part because they’re often available in generic form.

Such factors have raised questions about the value of abuse-deterrent opioids. Over the summer, the Institute for Clinical and Economic Review, a nonprofit that assesses the value of medicines, put out an analysis contending that evidence is lacking as to whether these pills reduce overall abuse. What’s more, the analysis found that these formulations come at a hefty price to both patients and the health care system: An additional $231,500 to prevent one new case of abuse. And $1.36 billion to prevent one overdose death.

“The enthusiasm for abuse-deterrent opioids is very questionable,” said Ameet Sarpatwari, an epidemiologist at Brigham and Women’s Hospital who was not involved in the ICER study. He added that he thinks the money spent on these products could be better directed to increase medication-assisted treatment of opioid addiction or expand access to naloxone, the overdose reversal drug.

Heffernan, though, sees Xtampza as an “incremental” improvement over existing abuse-deterrent opioids. “Granted, they’re not the panacea. Granted, they’re not abuse-proof. But they’re the best thing we have today,” he said.

Seeking a larger slice of ‘a shrinking pie’

Heffernan, a trained pharmacist, founded Collegium in 2002, in the heady days when opioids were being prescribed with little attention to consequence.

He didn’t set out, though, to build a dedicated opioid manufacturer. His company spent most of its existence working on different pharmaceuticals, only narrowing in on opioids after selling its dermatology business to Valeant Pharmaceuticals in 2014.

Collegium now employs about 275 people, about 75 of whom work in the company’s offices here in a corporate strip mall that feels farther away than it actually is from the glamour of the biotech hub in Kendall Square. (Its next-door neighbors include a mortgage lender and a food wholesaler that services hotels and restaurants.)

“Granted, they’re not the panacea. Granted, they’re not abuse-proof. But they’re the best thing we have today.”

MICHAEL HEFFERNAN, COLLEGIUM PHARMACEUTICAL CEO AND FOUNDER

Behind the rows of cubicles, the company’s scientists tinker with new formulations in two laboratories. Collegium’s doing early-stage testing trying to bring its technology to another opioid, known to scientists as hydrocodone. And the company also envisions applications for other drugs that can be abused, like stimulants to treat ADHD.

Buoyed by its recent successes, the company is running out of room and plans to move to a new, larger, space next year, in the same region southwest of Boston.

Collegium, which saw its stock price close on Tuesday at its highest point in over a year, is an unusual bright spot in a market that’s been hammered by the souring attitude among doctors, payers, and regulators to traditional opioids as the death toll continues to mount.

The market for opioids is “a shrinking pie and there’s room for Xtampza to get a bigger piece of that pie” — especially because “it doesn’t have the history and baggage that OxyContin has,” said Kevin Kedra, an analyst for Gabelli & Company.

Collegium’s pitch is increasingly winning over insurers. Florida Blue, Florida’s largest insurer, will drop OxyContin in January; the company “reviewed the medical literature and felt Xtampza would be a safe alternative for our members,” according to Florida Blue Vice President Scott McClelland.

Cigna, meanwhile, warmed to Xtampza because of Collegium’s willingness to agree to a value-based contract. The arrangement creates financial incentives for both Cigna and Collegium if the average daily dosage of Xtampza prescribed to Cigna customers stays below a certain level, part of an effort to address the opioid crisis, according to Cigna spokeswoman Karen Eldred.

Collegium also stands to benefit from FDA actions cracking down on certain opioids.

Over the summer, Endo International agreed to comply with the FDA’s requestthat it pull from the market long-acting Opana, the painkiller blamed for prompting an HIV outbreak in rural Indiana in 2015 when people addicted to opioids began injecting the drug. Since then, 7 percent of patients forced to find a replacement have switched over to Xtampza, according to Collegium.

And there may be more to come: Earlier this month, FDA Commissioner Scott Gottlieb announced that the agency is conducting a study of long-acting generic products containing oxymorphone, the same active ingredient that was in long-acting Opana. If it’s found to be easier to abuse, Gottlieb said, the FDA may take actions to “limit patient exposure” to these products, which some analysts think could ultimately mean removal from the market. If that happens, it could send more patients to Xtampza, analysts say.

Heffernan rejects the notion that he’s positioning his company as the anti-Purdue, saying the product’s benefits stand for themselves. He doesn’t think Purdue executives feel threatened by Collegium yet, either, a view echoed by analysts.

But Purdue, which is privately held, has gone after Collegium in the courts, alleging that Xtampza infringes on several of Purdue’s patents. The legal battle is ongoing. “Purdue’s motivation, I think, is clear … filing lots of patent litigation to both use up resources of a small company as well as try to get us off the market, is part of the strategy,” Heffernan said.

In response to specific questions from STAT, Purdue Pharma provided only a general statement, praising innovation in the development of abuse-deterrent opioids while warning that these products should not provide “a false sense of security” for patients and doctors looking for a painkiller that can’t be abused.

Collegium, for its part, is hoping to keep winning over insurers. After the deal with Cigna was announced last month, Collegium started hearing from more payers, said Joseph Ciaffon, Collegium’s chief operating officer. “We want exclusive positions” on their formularies, Ciaffon said.